Russia's largest lender Sber (Sberbank) sold its 36% stake in MF Technologies, which controls 57.3% of VK (former Mail.ru Group) for RUB12.8bn ($175mn) to Gazprombank. Sber originally bought the shares from Gazprombank and Rostech in October 2019 for RUB11bn. 

Exiting the capital of VK will fuel rumours that two majors are about to break up their $1.6bn JV in foodtech and transportation, which were previously refuted by Sberbank and Mail.ru.

VTB Capital (VTBC) believes that selling the shares might signal Sberbank's change in approach to its co-operation with VK (Mail.ru), where the bank held one seat on the board before the sale. 

The parts of the O2O JV (Samokat e-grocery delivery, Delivery Club food delivery and Citimobil taxi service) play an important role in Sberbank's ecosystem, VTBC notes, but sees the "divorce of the two partners was only a matter of time".

The sale of the stake in MF Technologies was seen as positive for Sberbank, by VTBC, as this will allow it to reroute funds to other ecosystem projects, including e-commerce platform Sbermegamarket, in order to reach its ambitious strategic targets. The analysts retained a Buy call on Sberbank's shares (12-month target price of RUB490, 51% estimated total return).

Sova Capital notes that while the sale implies a premium for VK’s shares, it actually involves a different share class, making the comparison with the 2019 deal less relevant (the 36% stake in MF is equivalent to indirect stakes of 20.6% and 1.7% of VK’s voting and economic shares).

Sova also believes that Sber selling the share "gives credence" to previous media reports that the Sber and Mail.ru relationship had soured and that the two companies were mulling a break-up. 

"It remains unclear whether Sber and Mail.ru are indeed planning to split the O2O JV at this stage, but we would not be surprised if this were to happen following the sale of SBER's stake in MFT," Sova wrote.

The analysts at Sova see the news as marginally negative for both VK and Sber. For VK, repeated changes in key shareholders typically do little to help a company stay on track. And in case of a divorce, Mail.ru is more likely to face more competition from Sber's own ecosystem.

As for Sberbank, the lack of clarity around the deal increases the probability of the O2O JV being dissolved, which could be seen negatively by the market, Sova argues, while affirming a Buy call on Sber and VK.

In the meantime, BCS Global Markets analysts remind that Sber and VK have just completed a round of additional investments (RUB12.2bn) in the JV in October, which makes the break-up less likely.

Nevertheless, "we think VK investors would rather prefer Sberbank as a shareholder – the sell-back looks puzzling and may spur concerns of possible O2O JV split," BCS Global Markets wrote, seeing the news as negative for VK (Mail.ru).

bne IntelliNews reported that Sberbank had teamed up with internet major Mail.ru Group on foodtech and delivery, after the bank's bitter divorce from major internet rival Yandex. However, first reports that the joint venture could fall victim to disagreements on strategy and “differences in culture and management” appeared in autumn 2020.

The major area of disagreement was previously said to be whether the O2O ecosystem should be based on Mail.ru social network VK or on Sberbank's financial services platform. In addition, Sberbank was reportedly frustrated with its lack of influence on Mail.ru (the bank held a 36% economic stake in MFT) with a voting power of only 20.6% and having little real influence due to Mail.ru's corporate governance structure.